Planning Your Taxes and Avoiding Penalties

Tax evasion is no simple matter. It is a criminal offense that can give birth to administrative and civil cases. Corporations have lost their credibility due to their failure to declare their true income and file proper taxes. Based on experience, practitioners of state, federal and international tax in Salt Lake City have seen good companies fall because of wrong tax declarations. It is important that you file your taxes on time and that you properly declare your assets and liabilities.

Cyclical Auditing of the Corporate Books

Inconsistencies in transactions and records in the corporate books are subjects of tax evasion. Simple mistakes can snowball into larger penalties if you are not careful. Foreign taxes and local taxes can be compounded and at times, you may be subjected to double taxations.

Tax Avoidance

Several activities can help lessen the taxes that you will have to pay. There are legally sanctioned ways to do this. This is exactly what tax avoidance is about. Contribution to state progress, science exploration, and donation to charitable institutions are among the many ways to lessen the taxes that you have to pay.

Raising the depreciation rates of your properties, however, is not tax avoidance but is effectively evading taxes. Even if this may seem like a normal practice by larger corporations, this is illegal practice and is characterized as an unfair business technique.

Tax Evasion

One major mistake committed by corporations and professionals is thinking that good faith or pure simple negligence is a good defense in tax evasion cases. The law does not make any distinction. Evasion may be intentional or unintentional. Any showing that a person failed to pay the right taxes, failed to declare his true income and delaying the payment are all acts of evasion. These are all punishable by higher taxes with interest, and at times, even imprisonment.

Remember that accurate corporate books make for easier tax filing. When you file on time, you can be assured that you will be given ample time to correct mistakes if there are any. Make it a habit to check your financial statements and to prepare your tax declarations months before the deadline.